Thinking out loud for a minute

[Dave's Not Here Man]

Upwards of 20 million people applied for unemployment as of last week. I think they said that was a record, even surpassing the Great Depression. The number is most certainly higher, given the fact that the state unemployment agencies have not been able to keep up with applicants and in some cases the phone and online access has been overloaded to the point of many people not being able to get through and apply. As always seems to be the case, a lot of those other people not counted will be the ones that had more than one job and still have at least one of them but the loss of others has cost them half or more of their income, have a job that didn't furlough them but cut their hours, wages, and benefits, etc and are "underemployed" in one way or another. My daughter has the task of furloughing 13 people in her department tomorrow, and surely this is going to happen every hour of every day in every city as this thing continues. In many instances, those businesses have an expiration date and as we've seen already, the doors will be closing for good. 

Now, everybody knows that traditionally, the backbone of this country has been small business. Too small to bail out, as it were. Small business also doesn't mean what it used to mean but for the purpose of making my point, let's just say any business with less than 50 employees. Fewer manufacturing businesses and more service, product, mom n pop, that kind of thing. Anyway, the CARES Act had 350 billion with a B as Carl Sagan used to say, dollars for small business loans. That got used up in one day. So while another 500B was put in for corporate bailouts that won't ultimately have any oversight, we can safely assume that small business will continue to trend toward the trash heap of history.

Moving on and more to my point; There will come a day in the near future when governors will be lifting the restrictions on all businesses and allow then to open and/or resume normal business for the ones that stayed open but operated only outside of the front doors (restaurants, etc). It's entirely possible but not in any way a guarantee that those businesses, the ones fortunate enough to weather the storm, will be rehiring the people they laid off. It's unknown whether or not the public will be so eager to get out right out of the gate, or if it will take time to see pre-virus traffic in their businesses. Suffice it to say there are a lot of unknowns. Who will be rehired? How many will be rehired? How many will not be able or interested in going right back to work because of the risk that will still be present, or because of other things that have happened to them personally, financially, during this lockdown? How many will be affected physically or emotionally and unable to return to their jobs or their line of work? 

What is the economic strategy for a worst case scenario, other than another 500b, and another 500b, and another 500b for Wall Street?

[minx]

There is no economic strategy, and there really wasn't one to begin with. Sending everyone a check was nice, but will $1200 really do much for the majority of people? Yeah, you might pay the rent for April, but May is right around the corner. And there seems to be absolutely no thought in terms of how to help people and businesses while things re-open. We might say that larger retail (businesses with over XX sq footage) can open with limits to occupancy, but will that help sit-down restaurants? And what if my store can take 10 customers at once, but my business before this was 30 customers at once?

This doesn't even take workers into account - if I haven't been called back into work, I'm not going to be spending money of frivolous things like hand-made soaps, so people may not even come into my store.

But it's okay - we're going to ignore the fact that large chains were able to get these new loans, while actual small businesses were locked out. Or that banks like JPMorgan/Chase didn't open the program to anyone outside of their customers. Or that the system to apply crashed almost immediately when it opened to applicants.

We can't just keep throwing money at the issue either, because we can only print so much before the dollar collapses. I'm not sure of the solution, because people (and businesses) are hurting NOW. And for every business that goes under a few jobs are lost. But the net impact of losing these businesses will be catastrophic overall IMO.

[bobathon]

BTW, those new applications for public aid? The overworked public employees working all that (for Fredburg) just took a 2% pay cut.

[k9krap]

And many of them are using systems that are 40+ years old!

[minx]

Yeah - lots of states are begging for programmers who know COBOL. That was a dead language back in the 1980s.

[Dave's Not Here Man]

We can't know what's going to happen or when, but do any of us believe that when we-they "open up the economy" everyone is just going to resume life, work, family, as if we all have been on pause and simply hit play/resume?

No. No one with even a partial functioning brain thinks that will happen. I've said enough about this in my OP and just want to reiterate that there's going to be a recovery and quite possibly a "new normal" in society, for better of for worse I'm afraid but for the purpose of this topic I'm going to focus on an economic recovery.

I'm of the opinion that it's going to take very bold steps to, once again, bring us back from the edge of the total economic collapse. Something akin to The New Deal. We have brilliant economists standing by in the event they happen to be consulted at some point and I'm, by no means, teaching any classes on economics. But the first thing that comes to my mind is putting as many people back to work as possible in a new economic system that is built for a long term recovery and long term durability. The first thing I think should happen is to get as many people over the age of 50 out of the workforce. Hear me out. No, if you are over 50 and need a job, have a job, want a job, I'm not talking about you. I'm talking about the people over 50 that are underemployed, gig workers, rideshare workers, and not making enough to cover their basic needs. Also included are those over 50 that are on, will be, or have applied for disability, SSI, who may be denied these benefits and will go back into one of the groups, or ones not mentioned, like the homeless. Instead of basing their benefits on time worked and their salary history, come up with a practical number (average mortgage payment, or rent, utilities, food, clothing) that it takes for any middle income person to meet that standard of living, and pay that amount to everyone over 50 that opts in. 1200 a month won't do it, 1500 a month won't do it, 2000 a month might work in some places but we'd be going by a national average, so probably 2500-3000 a month. Plus, we're going to be needing that single payer health care, socialized, nationalized, universal health plan. We're also going to be needin that free higher education for all comers, to go to community colleges, technical schools, trade schools, etc and zero interest loans for all those who qualify for advanced degrees at colleges and universities. We are going to insist that the people who have benefited the greatest to show their appreciation and make it their duty to sacrifice the most in terms of what they'll be contributing back into the society. Not with a bunch of talk about job creation, but with pre Reagan tax brackets on the very wealthy. Loopholes and tax shelters will need to be slammed shut. I think this is a much better idea than UBI, and I know some of you disagree, but I think it de-incentivises at least some from attaining higher standards of living and makes too much room for non-participation or as little as necessary to meet one's basic needs. We have seen generational cradle to grave welfare and we really need that to be a thing of the past, not an option. I have more on that but have to think them through before putting them out there.

[Dave's Not Here Man]

Response to lurkers asking HOW ARE WE GOING TO PAY FOR IT???1!

Part of that is addressed above. Plus, 70% tax top bracket on individual wealth. Flat tax on gross sales for corporations. Rescind all tax cuts on anyone making over 250k per household. Rescind all incentives for moving production out of the country to avoid taxes and regulations, and heavily de-incentivise the practice by putting massive tariffs on those goods products and services that they try to sell-back to Americans. Cuts in military spending- which comes mainly from closing down and systemically removing our presence abroad that is meant to intimidate, not deter, sovereign nations around the world. We outspend the top (I think it's 6, could be more) other countries' on defense COMBINED. We'll be fine with our 50 million dollar drones, 100 million dollar F35s, billion dollar subs and aircraft carriers, and multitrillion dollar military industrial complex.... or we won't. No new luxury furnishings for every new person in high ranking positions in government. No taxpayer funded business trips and security for government officials' families. Completely ridding our consciousnesses of trickle down economics. For starters.

[Dave's Not Here Man]

Corporations can get tax breaks for hiring 10% of their workforce as entry level positions with on the job training or in-house education, and things like day care centers for their workers' children. They can also get really nice tax break for building and operating community based job and career training centers, and funding affordable housing projects.